August 8, 2022

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3 charts show Europe’s unprecedented natural gas crisis

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Europe is facing an unprecedented gas crisis.

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Europe is facing an unprecedented energy crisis that’s pushing the economy closer into a recession and posing serious questions about the region’s climate change ambitions.

CNBC takes a look at how Russia, led by President Vladimir Putin, is squeezing gas supplies to Europe and what this means for the future.

Russia cuts supplies

Russia has significantly reduced flows of natural gas to Europe since Western nations imposed tough sanctions on the Kremlin following its unprovoked invasion of Ukraine on Feb. 24.

Moscow denies it is using gas as a weapon, but Europeans complain that Gazprom, Russia’s state-owned energy company, is no longer a reliable provider. Reduced gas supplies from Russia are a problem for EU nations given it used to import about 40% of its gas stocks from the country.

Data from Nord Stream, the operator in charge of a pipeline [Nord Stream 1] that links Russia to Germany, confirm that there’s fewer gas volumes heading West.

Last week alone, supplies via Nord Stream 1 were reduced to 20% from 40% with Gazprom citing maintenance issues

Germany’s Economy Minister Robert Habeck said Gazprom’s technical excuse was a “farce.” Supplies had been briefly halted before the latest reduction, with maintenance works being completed between July 11 and July 21.

According to the European Commission, the EU’s executive arm, 12 members states are already suffering from the reduced gas flows and a handful of others have been completely cut off.

Top EU officials say Russia is “blackmailing” Europe and “weaponizing” its gas supplies. Moscow has repeatedly denied the accusations.

“We have to be ready, there might be full disruption in near [the] future, and that means that we need to have a plan in place,” Kadri Simson, Europe’s energy commissioner, told CNBC last week.

European leaders are concerned about a complete shutdown in supplies, particularly because many industries use…

2022-08-01 04:42:00

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